Sustainability Report 2019

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Sustainability Report 2019 Better every day Sustainability Report 2019 This Sustainability Report is printed on 100% recycled paper from a sustainable source. About this report It contains insights into Almarai’s sustainability-related Welcome to our third programs, achievements and performance, complementing the information provided in our Annual Report 2019. annual sustainability report. This Sustainability Report Scope This report covers our operations as Almarai Company. represents a comprehensive This includes our operations in the GCC (Gulf Cooperation overview of our commitments Council), which includes Saudi Arabia, United Arab Emirates, Oman, Bahrain and Kuwait (referred to as ‘Almarai’) and our and progress towards operations in Egypt (Beyti) and Jordan (Teeba) under our joint venture International Dairy and Juice (IDJ), and in Argentina improving our environmental, and the USA as Fondomonte (defined for the purposes of this report as the ‘Subsidiaries’). This report does not cover social and economic impacts. Almarai’s operations as Premier Foods, Pure Breeds, and co-manufacturing. To the extent possible, considering data limitations, and the boundaries outlined above, this report covers all main operational and corporate functions, unless otherwise stated. Reporting guidelines This report has been prepared in accordance with the Cautionary statement Global Reporting Initiative (GRI) Standards: Core option. This report contains certain forward-looking statements that For further information and the GRI Content Index, express the way in which Almarai and its Subsidiaries intend please see Appendices A-D. to conduct its activities. These statements typically contain words such as “anticipate,” “believe,” “expect,” “estimate,” Where relevant, we also show our contribution to the “forecast,” “intend,” “plan,” “project” or similar expressions. National Transformation Program (NTP) of Saudi Arabia’s Such statements are based on assumptions made using Vision 2030 and the Sustainable Development Goals (SDGs) currently available information that is subject to a range in Appendices F and G. of uncertainties that could cause actual results to differ from these projected or implied statements. Any forward- looking statements contained in this report are therefore not Reporting period promises or guarantees of future conduct or policy, and thus This report covers the period from 1 January 2019 to Almarai and its Subsidiaries assume no obligation to publicly 31 December 2019, unless otherwise indicated. update any statements made in this report. Almarai and its Subsidiaries rely on information obtained from sources believed to be reliable but does not guarantee its accuracy Feedback or completeness. For questions or comments regarding this report and sustainability at Almarai, please contact us at: [email protected]. 2 Almarai Sustainability Report 2019 Contents Message from the Chairman 4 Message from the Chief Executive Officer 6 2019 at a Glance 8 About Almarai 10 Our value chain - Quality you can trust 12 Sustainability management at Almarai 14 Caring for people 20 Protecting the planet 32 Producing responsible products 44 Our subsidiaries 51 Appendices / GRI content index 56 www.almarai.com 3 Message from the Chairman Message from the Chairman On behalf of the Board of Directors, I am delighted to introduce our 2019 Sustainability Report. 4 Almarai Sustainability Report 2019 Over the past year we have focused on becoming a more Our sustainability strategy will help us to drive better practices dynamic Company to overcome challenges and seize in our own operations and strengthen our relationships with opportunities available to us in an economically challenging stakeholders, whether they be local, regional or global. We environment. We understand that operating in a changing have considered how our sustainability strategy aligns with environment requires agility and novel approaches to the the sustainable development objectives of the Saudi National way we do business. We believe that an intensified focus Vision 2030, as well as the global Sustainable Development on sustainability complements our corporate strategy, Goals. Moreover, the launch of our sustainability strategy in contributing to our dynamism and resilience, by recognizing 2020 comes at an exciting time when several initiatives are and responding to the environmental, social and economic being launched within the Kingdom for the G20 summit. factors that impact both our business and stakeholders. It is our hope that Almarai inspires our peers to raise the In 2019, we continued to build on the firm foundations we have bar, not only within the Food & Beverage sector, but the put in place to more strategically manage sustainability and wider economy, to create shared valued through effective drive tangible and impactful change. We have refocused sustainability management. our approach to highlight how action on sustainability can unlock our potential to create shared value, developing 25 Through our sustainability reporting we offer our stakeholders sustainability targets to achieve by 2025. insights into how we are using sustainable thinking to challenge and improve our practices every day. At Almarai, As the Middle East’s largest food and beverage manufacturer we realize that the prosperity of future generations depends and distributer, and the world’s largest vertically integrated on our actions today, and we are working towards positive dairy company, we play an important role in shaping the change that can support a better tomorrow. market for the better. Our sustainability strategy, ‘Better every day’ is our answer to this call. By reporting our progress against our targets from 2020, we are taking a significant step forward in our ongoing journey to embed a sustainable mindset within our business. Sultan bin Mohammed bin Saud Al Kabeer Chairman of the Board www.almarai.com 5 Message from the Chief Executive Officer Message from the Chief Executive Officer It is with great pleasure as Almarai’s CEO to have the chance to present our third annual sustainability report, providing us with the opportunity to inform our stakeholders about our sustainability journey and performance. 6 Almarai Sustainability Report 2019 Our focus on building a more dynamic future over the past We have also worked to remove nearly 3,000 tons of plastic year falls squarely in line with our maturing approach to packaging from our products. Packaging innovation continues coherently manage sustainability within our business. We to remain a focus area as we strive to reduce our contribution acknowledge that our long-term growth prospects and to the consumer waste stream. This aim is leading us to ability to create shared value are integral to how we actively support work to transform the packaging economy in the manage our environmental, social, and economic impacts. Kingdom to deliver viable waste management solutions. A sustainability mindset only adds to our dynamism as it supports innovation and resilience, it simply makes good Supporting the health and wellbeing of our employees business sense. is not only the right thing to do, it also supports business performance. We began to roll-out our occupational health In 2019, we solidified our belief that the world can be a program during 2019. Our mobile health unit has screened better place if we are all committed to doing better every over 500 people during the year, identifying health conditions day, through the development of our sustainability strategy which through early detection, has helped raise awareness of for 2025, ‘Better every day.’ Our new strategy outlines our potentially harmful illnesses and conditions. commitments and targets for sustainability that will drive improvements within our business in the years ahead. While I invite you to read through this report which provides a the strategy officially launches in 2020, we continued to comprehensive overview of our approach to sustainability, implement initiatives throughout the year that have helped us covering the issues that matter most to us, and the efforts we to make positive changes. are making to embed sustainability management throughout our business. In 2019, we completed the installation of the largest private solar energy project in the Kingdom. By the end of 2020, I would like to thank the management for their support, and through the commitments we have made to developing a I look forward to working with our stakeholders to develop a clean energy portfolio, we expect that approximately 10% deeper level of engagement to help meet their expectations of our total electricity consumption in the Kingdom will be in the coming year. By working in partnership and addressing derived from renewable sources as more solar projects the issues that are most important to our stakeholders and become operational. our business, we can continue to contribute to a sustainable future. In addition to clean energy, we are working to improve energy efficiency. In 2019, we completed Phase 1 of our LED lighting upgrade, contributing to an estimated load reduction of up to 70%. Following the completion of Phase 2, in the coming year, some 70,000 lights across our facilities will have been replaced with LED technology. Majed Nofal Chief Executive Officer www.almarai.com 7 2019 at a Glance 2019 at a glance Beyond profitable growth, Almarai wants to ensure it makes a positive contribution to society and minimize its impact on the environment. In 2019, we continued to make progress every day towards becoming
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